Going the Distance: Four Ways to Build a Better Customer Loyalty Program for Your Brand

It’s easy enough for a customer to join your loyalty program, especially when you’re offering an incentive such as discounts. All your customer has to do is give out some basic information, and voila! They’re in the fold, a brand new loyalty member with your company. From there, it’s happily ever after. You offer the perks; they stand solidly by you, bringing you their continued business. Simple. Or is it? In reality, just how many of those customers are act ively participating in your loyalty program? Do you know? Sure, loyalty program memberships are on the rise according to market research company eMarketer, having jumped 25 percent in the space of just two years. However, that figure may be a bit misleading. The truth is that, while loyalty program sign-ups may be more numerous, active participation in such programs is actually in decline. At the time of the study, the average US household had memberships in 29 loyalty programs; yet consumers were only active in 12 of those. That’s just 41 percent. And even that meager figure represents a drop of 2 percentage points per year over each of the preceding four years, according to a study by loyalty-marketing research company COLLOQUY.

When discounts just aren’t enough

So what’s a brand to do? How can you make your loyalty program worth your customer’s while—as well as your own? After all, gaining a new loyalty member doesn’t mean much if your customer isn’t actively participating in your program. Consider this: Does your customer loyalty program offer members anything different from what your competitors are offering? Chances are your program includes discounts. That’s a given. And what customer doesn’t appreciate a good discount? But when every other company out there is providing this staple benefit in comparable amounts, it becomes less and less likely that customers will remain loyal to any one particular brand. Frankly, it’s all too easy for customers to get lost in a sea of loyalty member discounts. They’re everywhere. In fact, just under half of internet users perceive that all rewards programs are alike, according to a 2015 eMarketer survey. The key to success, then, is to differentiate your business from the crowd. If you can offer your customers something unique and valuable beyond the usual discount, chances are they’ll be more likely to stick with your brand. Here’s some inspiration from companies who get it.

Virgin: Reward more purchases with more benefits.

That’s not to say you need to get rid of discounts entirely. In fact, nothing could be further from the truth. Customers still love a good discount. The goal is to be creative in terms of the loyalty perks you offer. Take the Virgin Atlantic Flying Club, for example. As part of its loyalty program, the airline allows members to earn miles and tier points. Members are inducted at the Club Red tier, from which they can move up to Club Silver and then Club Gold. Here, it’s not just a discount. It’s status. And people respond to feeling important, elite. Still, even where the rewards themselves are concerned, Virgin is motivating loyalty customers with some pretty attractive offers. At the Club Red tier, members earn flight miles and receive discounts on rental cars, airport parking, hotels and holiday flights. But as members rise in tiers, they get even more. At the Club Silver tier, members earn 50 percent more points on flights, access to expedited check-in, and priority standby seating. And once they reach the top, Club Gold members receive double miles, priority boarding and access to exclusive clubhouses where they can get a drink or a massage before their flight. Now that’s some serious incentive to keep coming back for more. Discounts are still part of the equation – but they are designed with innovation and personal value in mind, elevating them to more than just savings.

Amazon Prime: Pay upfront and become a VIP.

What if your customers only had to pay a one-time upfront fee to get a year’s worth of substantial benefits? It may not sound like the smartest business idea at first glance. But take a closer look. Amazon Prime users pay a nominal $99 a year to gain free, two-day shipping on millions of products with no minimum purchase. And that’s just one benefit of going Prime. It’s true that Amazon loses $1-2 billion a year on Prime. This comes as no surprise given the incredible value the program offers. But get this: Amazon makes up for its losses in markedly higher transaction frequency. Specifically, Prime members spend an average of $1,500 a year on Amazon.com, compared with $625 spent by non-Prime users, a ccording to a 2015 report from Consumer Intelligence Research Partners.

Patagonia: Cater to customer values.

Sometimes, the draw for consumers isn’t saving money or getting a great deal. The eco-friendly outdoor clothing company Patagonia figured this out back in 2011, when it partnered with eBay to launch its Common Threads Initiative: a program that allows customers to resell their used Patagonia clothing via the company’s website. Why is this program important to customers? And how does it benefit Patagonia? The company’s brand embraces environmental and social responsibility, so it was only fitting that they create a platform for essentially recycling old clothing rather than merely throwing it away. The Common Threads Initiative helps Patagonia build a memorable brand and fierce loyalty by offering its customers a cause that aligns with deep personal values. OK, so their customers get to make a little money, too. Everybody wins.

American Airlines: Gamify your loyalty program.

If you’re going to offer your customers a loyalty program, why not make it f un? After all, engagement is key to building a strong relationship with your customer. And what better way to achieve that goal than making a game of it. American Airlines had this very thing in mind when it created its AAdvantage Passport Challenge following its merger with USAirways. The goal: find a new way to engage customers as big changes were underway. Using a custom Facebook application, American Airlines created a virtual passport to increase brand awareness while offering members a chance to earn bonus points. Customers earned these rewards through a variety of game-like activities, from answering trivia questions to tracking travel through a personalized dashboard. In the end, participants earned more than 70 percent more stamps than expected – and the airline saw a ROI of more than 500 percent. The takeaway: people like games.

Stand out from the crowd.

Your approach to your customer loyalty program should align with your overall marketing approach. Effective branding is about standing out, not blending it. Being memorable is key. To this end, keep in mind that loyalty programs are no longer a novelty. That means that yesterday’s strategies won’t work moving forward, so look for ways to rise above the noise, setting yourself apart from the cloying drone of countless other cookie-cutter programs.

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Pareto Principle Demystified: Applying The 80/20 Rule in Website Design

Are you spinning your wheels trying to boost traffic to your website? Are you constantly pouring resources into your site in an attempt to make sure that it’s everything your customers could want – adding new features, testing new strategies, redesigning in the name of staying current with the latest trend? What if I told you that the key to improving your website’s performance lies not in doing more but in doing less? If that prospect sounds too good to be true, I assure you that it’s not. Allow me to introduce you to the 80/20 Rule: focus on the 20 percent of things that will fetch you 80 percent of the results.

The 80/20 Rule defined

The 80/20 Rule is often interchangeably known as the Pareto Principle, Juran’s Principle and the Principle of Factor Sparcity. So what exactly is this multi-monikered principle? Let’s turn to Wikipedia for the answer: “The Pareto Principle...states that, for many events, roughly 80 percent of the effects comes from 20 percent of the causes.” The concept was the brainchild of business consultant Joseph M. Juran, and its namesake is Vilfredo Pareto, an Italian economist who observed in 1906 that 80 percent of the land in Italy was owned by 20 percent of the population. Since then, the principle has been applied widely to all aspects of business, whether it’s that 80 percent of a company's profits come from 20 percent of its customers, 80 percent of its sales come from 20 percent of its products or 80 percent of deals are closed by 20 percent of its sales staff. By following this principle, many businesses have realized great gains in profitability by focusing resources on the areas that net the greatest effect and eliminating, ignoring, automating, delegating or retraining the rest.

But how does the Pareto Principle apply to website design?

For the answer to that question, let’s head over to the blog of Tim Ferriss, a well-respected efficiency expert with a well-documented affinity for all things minimalist. Ferriss, a proponent of the 80/20 Rule, once performed a case study and noted that websites optimized using the Pareto Principle have a 20 percent higher conversion rate. Further more, Ferriss observed that in order to effectively implement the Pareto Principle in the design of any given website, only certain changes are required to be made, the majority of which involve the home page itself, since that is where most – if not all – of the site’s most mission-critical information lives. Most of these changes are relatively minor in nature, such as a cleaner call-to-action button, an uncluttered sidebar and so on.

Why should you use Pareto Principle in your web design?

The benefits of applying the Pareto Principle in the design of your website are two-fold for your visitors and for yourself. To begin with, the Pareto Principle means less work for you. Rather than fussing and fretting over how to max out every available square pixel of real estate on the screen with every conceivable feature and copy point, you only have to concentrate on that most important 20 percent that will take care of the remaining 80. Plus, keeping the focus on the most essential aspects of your site website ensures that your visitor’s attention is driven straight to your primary call-to-action elements (in fact, the Pareto Principle can be detrimental if not backed with a crystal-clear call-to-action mechanism). This in turn leads to higher conversion rates and winning over more new fans, subscribers and customers for your brand. From the perspective of visitors to your site, the Pareto Principle guarantees that they can look forward to a clean, streamlined browsing experience with fast page-load times that’s free of distractions and frustrations of any kind, thereby helping to turn turning random first-time visitors into regular users.

Putting Pareto into practice

Now that you’re on board with the Pareto Principle, how do you go about putting it into practice? To begin with, let’s take a literal interpretation of the rule: focus on the 20 percent of the elements that are responsible for the other 80. What is that magical 20 percent of the most vital things in your website? Call-to-action buttons, traffic funnels, images, whitespace, etc., right? In other words, USER EXPERIENCE. Yes, that’s right. The driving motive behind the 80/20 Rule is to provide the best possible user experience. Let’s examine the simple example of social sharing buttons – a nearly ubiquitous presence on every website or blog nowadays. Look at the sharing buttons that are present on your website. When was the last time the MySpace, Friendster or Digg buttons were used? These do not belong in that vital 20 percent. Similarly, let’s focus on another commonplace element of web design – the sidebar. Look at the sidebar elements on your own website or blog. What’s the purpose of having your 15 most recent posts listed there? If you are running a blog, your visitors can easily find your most recent posts on the main page of the blog itself. If you are designing for mobile, the Pareto Principle becomes all the more vital. In general, the elements that are prioritized for a mobile version constitute that 20 percent. If you are able to freely leave out certain sections of your website in its mobile version without negatively impacting its usefulness to your visitors, chances are that those sections do not belong in the most important 20 percent segment of your desktop version, either.

Five simple steps to implement Pareto

1. Identify the primary objective of your website. Is it to sell products, promote your brand or provide a service to the community? 2. Next, make a list of all items on your website that contribute directly to the fulfillment of this goal. For example, if you are selling products, the area where you promote your latest special offer or new arrivals belongs in the 20 percent. Also make a similar list of items that do not directly contribute to the main goal. 3. Eliminate any and all unnecessary elements. Easier said than done, isn’t it? 4. Refine, refine, refine. Make sure the focus of every page and every element on the page remains on that critical 20 percent of items that directly support your main objective. 5. Grab a coffee.

Analysis, prioritization, optimization and simplification

Before you launch into an all-out take-no-prisoners offensive to streamline your website, here are a few additional tips to consider: Analysis: Use tools such as Google Website Optimizer and Analytics to analyze your website’s most frequently used and important elements. Prioritization: Once identified, prioritize that 20 percent of important aspects that are responsible for 80 percent of the results. Optimization: Optimize that 20 percent elements and thereby see a boost in 80 percent of the performance. Simplification: Implement good design principles of minimalism and reductionism to simplify your site’s user experience without sacrificing quality. A final word of caution: Don’t overdo the 80/20 Rule. While you do want to focus on the 20 percent, this does not mean you should outright ignore the other 80 percent of lesser important things. When it comes to user experience, the details matter. Unarguably, the greatest benefit of implementing the Pareto Principle in the design of your website is that it allows you to keep your focus on the content that matters most. So go ahead, and experiment with putting it into practice. After all, what do you have to lose besides the clutter that is holding your site back from reaching its maximum performance potential?

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10 Steps to Conquering Twitter Through Trustcasting

A simplistic platform with complex rules

As a vehicle for communicating with customers, Twitter is a deceptively simple platform that, in reality, is a challenge to truly master. First, there’s the format. How do you develop meaningful relationships 140 characters at a time? There’s also the overwhelmingly expansive size of the community. With 200 million registered accounts in the Twitterverse, how do you attract followers that belong to your tribe and will help your business grow? Furthermore, there’s the staggering pace of the flow of information and dialogue. With an average of 110 million new tweets every day, how do you make a meaningful contribution? Each of these complex questions share the same answer: trustcasting. As we established in the Trust Manifesto, “In a marketplace founded by, built by and existing for the people, trust is the only fundamental currency.” The results you yield from your participation in the Twitterverse will only ever be as good as the time and effort you invest in earning trust and developing genuine relationships with others. If ever there were an ecosystem built by and existing for the people, it’s Twitter. Each user is the sole arbiter of who is and is not granted permission to be present in their feed. Each and every user is judge and jury of good and bad content; the interesting, relevant stuff gets elevated and passed along to their own networks while the boring, self-serving stuff withers and dies out quickly. The one and only way to break through is by engaging in an ongoing process of building and maintaining trust. Following the golden rule of trustcasting, everything must be centered around developing authentic and reciprocal relationships between your company and other members of the community – a process for which no shortcuts exist. The results you yield from your participation in the Twitterverse will only ever be as good as the time and effort you invest in earning trust and developing genuine relationships with others.

Here are 10 essential steps you must follow to conquer Twitter by adhering to the principles and practices of trustcasting:

1. Be one with the medium.

Before you dive in and make potentially embarrassing or even reputation-killing public blunders, observe the ways in which other more experienced users engage and interact with each other to get the lay of the land. Nothing screams “Imposter!” like someone who goes tearing through the Twitterverse like a bull in a china shop with no regard for the nuances of the community. By showing disregard for the unique language and customs of the Twitter ecosystem, you also show that you’re disinterested in serving anyone’s interests other than your own.

2. Step out from behind the corporate curtain.

While the old familiar rules of marketing would dictate that your handle should be your company name and your avatar should be your logo so that your brand is always front and center, Twitter isn’t a collection of brands on a shelf but a living, breathing community of people. If your customers encounter a faceless brand, they don’t know if the person behind the curtain is the great and powerful Oz or your summer intern. It’s much more natural for your followers to have an authentic conversation with a human being. Set up your profile with a photo of yourself and a bio that tells us more about you than your official job title while remaining transparent that you also represent a company. Make sure to let your personality to shine through and to allow your interactions display human qualities – whether it’s candor, humor, generosity or even humility. By allowing members of the community to get to know you on a personal level, you open the doors to a deeper level of engagement.

3. Find real people you can have real conversations with.

With so much buzz around the concept of influence on Twitter, it’s tempting to go chasing after the users with the highest follower counts and try to entice them into your circle, knowing that one retweet will reach thousands of potential customers. However, it’s more important to find members of your tribe – those whose interests and needs align with the products or services you offer – who will be receptive to what you have to say. A good way to find these people is to regularly search for users in your area who are talking about subjects relevant to your offering. For example, let’s say you’re a dog trainer. You could enter the search terms “puppy near:Charlotte within:20mi” to pinpoint users near you who might be interested in the tips, articles and offers you have to share. By following them or replying to their tweets when appropriate, you’ll increase the likelihood that they will follow you in return. As you build a friendly rapport with this group of core followers, others will take notice and want to join in the conversation. It will be as if you are at the head of the cool kids’ table, and they want to pull up a seat. Contrast that with a scenario in which you have amassed a list of supposedly influential users who ignore your content and never respond to you. Where did all the effort to win their follow leave you?

4. Give before you expect to receive.

The holy grail of Twitter is transforming your followers into evangelists who retweet your content through their networks and give it legs to travel far beyond your immediate circle of influence. However, you can’t expect the rewards if you don’t put in the work. It’s up to you to find or create interesting content that’s worthy of a share. Promotions and giveaways are easy fodder for sharing, but they’re not the only share-worthy material. A link to a thought-provoking article, an inspiring quotation or a helpful how-to video are also highly sharable. Even if the content isn’t originally yours, you’re doing a service to your community by finding good information and passing it along.

5. Put sales objective second to trust objectives.

Twitter is a medium, not a broadcast channel.You’ll only be successful if you approach it as a means to cultivate a tribe of people you’ll enjoy conversing with, learning from and sharing with rather than a tool to give you unlimited access to a captive audience that you can barrage with marketing messages at will. Don’t engage followers as a brand with an agenda to sell but as an ambassador for your brand with intentions of making a meaningful contribution. For example, let’s say you own a store that sells running gear. You should make it a regular practice to pass along links to local races, share articles from around the blogosphere about good running form and nutrition, offer helpful tips to users who tweet about their struggles staying motivated and give shout-outs to customers who have achieved personal milestones like completing their first 5k. Without ever posting a direct link to a product, you can allow prospective customers to reach their own conclusions that you are the kind of company they want to support when they’re ready to make a purchase.

6. Reach out.

Remember that Twitter is, in essence, one sprawling public forum. As a result, you don’t have to sit back and wait for someone to approach you. It’s perfectly acceptable to jump into the conversation, as long as you follow the rules of trustcasting in doing so. Don’t be disruptive, and don’t go straight for the kill with a hard sales pitch or a link to your website. If you see an opportunity to join in a dialogue with something insightful, helpful or even funny, go right ahead. You might get a response or a follow in return for your efforts. More importantly, over time, you’ll cultivate a reputation for being a trusted source of interesting, useful or entertaining information, and your company and your brand will reap the benefits of your perceived authority in these areas.

7. Be responsive.

Always be responsive if someone directs a question or comment your way. It’s smart to keep tabs on mentions of your name or the name of your company so that you can reply as quickly as possible. Attention spans on Twitter are short, and if hours pass before you respond, chances are good that the person has moved on, and you will have missed the window of opportunity for a good two-way dialogue. It’s also important to be an equal-opportunity responder. While it’s always fun to reply to someone who is raving about your product or service, it’s dangerous to ignore those who have complaints. Respond to your critics with sincere concern and express an earnest interest in making things right, just as you would a dissatisfied customer who was standing in front of you in your store. Even if your efforts are rebuffed or ignored, you will have done your best publicly to demonstrate that you have their best interests at heart. In trustcasting, respect for the customer is paramount.

8. Be the kind of follower you want to have.

One of the best ways to earn goodwill in the Twitterverse is to promote others’ content. When someone you’re following shares a link to a thought-provoking blog post, news article or video, retweet their content, giving them credit for their great find. Elevating other members of the community is a simple, selfless act that demonstrates that you’re there to do more than toot your own horn.

9. Let your guard down.

The best thing social media – Twitter included – has done for business is removing the barriers that once stood between companies and their customers. No longer are you bound by the restrictions of mass media channels; instead, you can interact directly with your customers on a personal level. Therefore, your participation on Twitter must follow the rules of the culture of the Web. If you insist on holding your followers at arm’s length and only allowing them to see a perfectly polished version of your company, you won’t get the most from your efforts. Instead, go with the flow and keep it real. Your tweets are essentially part of a long-running chat. Keep your tone light, casual and approachable. You can even give your followers the occasional behind-the-scenes glimpse into daily ins-and-outs of your business. If you own a bakery, and you tweet a photo of your chef hard at work making your signature dessert, it’s a great way to remind your followers that they can swing by and pick up a freshly baked, handmade treat without explicitly asking them to do so. And they’ll feel more invested in your success because they will feel more connected to the people behind the name.

10. Be patient and persistent.

You won’t be an overnight Twitter sensation. You may not ever play on the level of Martha Stewart or Ashton Kutcher. But you also don’t need millions – or even thousands – of followers to make your participation worth your while. At its core, Twitter is a high-tech version of traditional grassroots marketing. You must build your community one follower at a time. Keep your focus on the quality of your community and the depth of your interactions, both of which you must allow to grow naturally and organically. In trustcasting, there’s no substitute for honest intentions and hard work. But while earning and maintaining the trust of your followers is a more indirect path to business growth than conventional carpet-bombing sales and marketing tactics, it will ultimately allow you to achieve the greatest return in securing ownership of your market.

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